Article
Finance
Corporate World / Global Community
To keep the machinery of the world running, one of the essential elements is money, which works as oil to keep it all going. Money facilitates billions of transactions by giving goods and services in return. Among many type of transactions, the subject of this article is remittance; an action of sending money between two separate account holders. In simple words, remittance is a transfer of money from one bank account to another either domestically or internationally.
Contents
1. Remittance
2. Transaction Monitoring by Government
3. Types of Remittances
4. Remittance Impact on Developing Countries
5. World’s Top Remittance Sending Countries
6. World’s Top Remittance Recipients
7. International Remittance Life Cycle
8. Digitalize Money Transfer
9. Money Transfer Software
1. Remittance
Remittance is not a new phenomenon in the world, one way or another it has always been a part of human history. Several European countries, for example Spain, Italy and Ireland were heavily dependent on the received remittances during the 19th and 20th centuries. All of those countries created policies on remittances. For instance, Italy was the first country in the world to enact a law to protect remittances in 1901, while Spain was the first country to sign an international treaty (with Argentina in 1960) to lower the cost of the remittances received. Since 2000, remittances around the world have increased significantly and represent the largest source of foreign income for many developing economies. Now, let’s understand the importance of remittance and its impact on the global economy.
2. Transaction Monitoring by Government
A country’s government and central bank plays a key role in the circulation of money. Government monitors money supply and keep the record of all of its international credits and debits. A country’s balance of payment (BOP) is a record of its international transactions. This record track transactions by individuals, businesses and the government. Tracking these transactions helps the government to keep a control and monitor how much money is coming or leaving the country.
3. Types of Remittances
There are two types of remittances: Outward remittance and Inward remittance. In simple words, sending money abroad is outward remittance and receiving money is inward remittance. An outward remittance is a safe way of doing international money transfer. You can use outward remittance to cover business transactions, family support, cover the living expenses, buy assets, and more. However, inward remittance heavily protects underdeveloped countries against financial setbacks.
4. Remittance Impact on Developing Countries
Inward remittance matters a lot for underdeveloped countries. It improves the financial status of family members left behind and thus accelerates economic growth of receiving countries. For the developing countries inward remittance boosts the gross domestic product (GDP); allowing the government to tackle poverty and carry out productive development strategies. Moreover, inward remittance helps to improve financial autonomy of local governments.
5. World’s Top Remittance Sending Countries
Predominantly, migrants are the force to keep this wheel of remittance moving; who send huge amounts of money back home to their loved ones. As migrants have shuffled globally; they have family members back home who they continue to support through cross-border remittances. The United States has been the leading source of sending remittances. Moreover, Saudi Arabia, United Arab Emirates, Germany, Canada, France, Russia and Switzerland are the largest senders of remittances globally.
6. World’s Top Remittance Recipients
Inward remittances have a major impact on the economy of developing countries. India, consecutively remains the top receiver of remittances in 2018. Other top recipients are China, Bangladesh, Philippines, Mexico, Pakistan, Egypt, Vietnam, Ukraine and Nepal. These remittances work as a lifeline for millions of people suffering from the financial crisis. Inward remittance serves to protect the people of under developed countries against poverty.
7. International Remittance Life Cycle
There are many different ways to transfer funds internationally. Payment methods include cash, check, wire transfer, mobile money, bank draft and online payment gateways; any way can be chosen to send money abroad. After the transaction has been made, no matter the method chosen, transaction take a basic route to complete the payment cycle and then the funds will be transmitted to the recipient’s bank for processing. On the other hand, the payout location or partner in the recipient country receives instructions from the sending service to deliver the funds in the specific way the sender has asked for. Briefly, this is how remittance life cycle works and money transfers from sender to beneficiary.
8. Digitalize Money Transfer
Speaking of remittance technology and to serve money transfer business globally, RemitAnywhere is here with years of expertise. We are based in the United States. At the moment we are serving live in more than 50 countries around the globe with robust reliable technology. With over 20 years of combined experience in product development and software lifecycle, RemitAnywhere offers an enterprise level software; a total solution that can centrally manage and automate workflow of your money transfer organization globally. As a technology service provider company, we offer money transfer software that automates the full life cycle of a money service business, bank, and money transfer operation from the point of initiation till the fulfillment.
9. Money Transfer Software
Our solution is a collection of money transfer products and services that work hand in hand to create a centralized cloud-based money transfer system that is both user-friendly and compliant with the regulatory bodies worldwide. We ensure that all of our client’s data is secured and kept safely on our secured servers. We guarantee robust reliable technology for your money service business. Whether you are a start-up or an established business, you are welcome to contact RemitAnywhere.
For more information, advice and support you may contact us.
RemitAnywhere would be delighted to help grow your business.
Contact us at: sales@remitanywhere.com or call at: 646–722–9500
Thank you for reading!
Written by
H. A. Tepha
This publication is not intended to cover every aspect of the topics with which it deals. Seek professional advice if you need any financial assistance. This publication is provided for general information purposes only.
